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    "Shirt Economy" 2010 Finally Failed?

    2010/7/21 10:34:00 57

    Shirt Economy

    China's market economy reform is a revolution from scratch.

    Without capital and without technology, the only one is adequate and cheap human resources.

    Starting from the labor-intensive low-end manufacturing industry, how much is the choice that only "comparative advantage" forced.

    Some economists have summed up such a take-off mode as "economics of shirts". They also focus on the fact that textiles and clothing belong to the most low-end labor intensive type.

    Coupled with environmental laws and regulations, labor protection laws and regulations are not perfect, enterprises at the expense of the environment, by reducing labor costs to develop, almost do whatever they want.

    Until a few years ago, Chinese economists still sang praise for this "shirt economy", and even the argument that "we can't afford to be optimistic about China" and "China's economy is freer than the United States" and so on.


    If the prosperity created by this model is a miracle, then the end of this mode suddenly exceeds people's expectations.


    In recent days, the Wall Street journal and the New York Times have published several lengthy reports that the pay rise in 2010 reflects the general trend of labor shortage in China, which has been hard to resist in reality and will greatly cut down the growth rate of China's economy.

    The paper shows that by 2010s, China's economic growth "eight guarantees" is almost impossible, of which 2011 to 15 years.

    Gross domestic product

    The average annual growth rate is expected to be less than 8%, 2016 to 20 years is about 7%, from 2021 to 25 to below 7%, from 2026 to 30 to below 6%.

    This downward trend is basically the same as the shrinking of labor supply in China.

    In 2015, China's labor supply reached its peak and began to decline.


    Third countries in the world have younger and cheaper labor force.


    Because

    Low end manufacturing industry

    The labour market is dominated by unskilled workers who work hard and hard. The general workers retire before the age of 65, and the supply of young labor is the key.

    But the number of young generation is the worst.

    Among them, labor supply from 16 to 24 years old has reached its peak and will fall by 1/3 in the next 12 years.

    In Zhongshan, Guangdong, many factories have a shortage of 15 to 20%, and even the boss has been driving a luxury car to the streets to recruit workers.

    Experts estimate that since 1970s, the contribution of adequate and cheap labor force to GDP growth rate has reached 1.8%, but by 2030, the shrinking labor supply will cut 0.7% of the GDP growth rate, which is the annual growth rate of 2.5%.


    At the same time, one of the most labour intensive industries.

    Textile and garment industry

    Vietnam and Pakistan are only 1/3 of the labour force in China.

    In the US dollar, the minimum monthly salary for China's coastal provinces is 117 - 147 dollars, while Bangladesh is only 24 dollars.

    Bangladesh, a well paid garment worker, earns only 64 dollars a month.

    According to the world trade organization's estimate, Bangladesh is now the third largest garment exporter after China and Turkey.

    The population of Bangladesh, which has a population of 160 million, has a population of 70 million, and is estimated to be a substitute for 20 million Chinese jobs.

    Li & Fung, a Hongkong giant supplying WAL-MART and other commercial giants, increased its production in Bangladesh by 20% last year, while its production in China dropped by 5%.


    The strategy of Western dispersed manufacturing base


    Of course, there are still many obstacles to be overcome in countries like Bangladesh.

    Worst of all, education is not universal. Literacy rate is only 55%, far from China's 92% level.

    As a result, the productivity of workers in this country is only 1/4 of that of Chinese workers.

    In addition, the backwardness of infrastructure is also a bottleneck for development. There is no power and power network like China, and it is in a state of power failure for 6 to 7 hours a day.

    However, in the early days of reform and opening up, China was lagging behind and catching up very quickly.

    Surprisingly, Bangladesh's clothing exports doubled from 2004 to 2009 under such backwardness.

    Besides, there are many places like Bangladesh in the world.

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